Moody's rates CACI facility Ba2

Moody's Investors Service said it has assigned a Ba2 rating to CACI International Inc.'s proposed $550 million senior secured credit facility.

Ratings assigned include a Ba2 rating to the company's $200 million senior secured revolving credit facility due 2009 and $350 million senior secured term loan B due 2011. The speculative grade liquidity rating is SGL-2.

The outlook is stable.

Proceeds from the proposed offering will partially be used to fund the acquisition of the Defense and Intelligence Group from American Management Systems Inc for $415 million.

Moody's said the ratings consider CACI's position as a government information technology provider, its relatively consistent and sizable contract backlog as a percent of revenues, stable client base, high quality contracts and receivables, as well as low capital expenditure requirements. The ratings also consider the benefits that are expected to be derived from the acquisition including various new products and cross selling opportunities.

The ratings also consider the competitive nature of the company's business and the changing landscape that is brought about by the number of mergers in the industry. The company's revenue growth and margins rely heavily on government funding and are subject to federal budgetary pressures, if these were to develop.

The agency added that the ratings also consider the challenges related to assimilating the target company and the expectation that the company will continue to grow through acquisition.

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